You might be looking at new credit card offers; you’ve probably realized there are quite a few options out there. There is a wide range of credit cards made available to consumers where the offers and benefits vary based on the number of people they serve. Here are types of credit cards for different financial situations.
Balance transfer credit card
Balance transfer credit cards allow you to transfer credit cards from other lenders free for a certain amount of time. It is also worthy to note that introductory APR doesn’t last long, therefore always ensure you have laid down plans to pay your balances within the initial period.
Subprime credit cards
These types of credit cards are mostly geared toward applicants who have a bad credit report. These types of credit cards usually have high-interest rates and fees than many others. But approval is often quick even for those with bad credit; however, the terms are often confusing. The Federal government came up with rules regarding the number of fees subprime credit card issuers can charge; however, the card issuers, most of the time, look for loopholes and ways to violet these rules. Despite the unpopularity of subprime credit cards, some people continue to apply for the cards because they cannot get credit elsewhere.
Rewards credit cards
Rewards cards always offer rewards on credit card purchases. Rewards credit cards are the best credit cards to build credit categorized into three basic types of reward cards as follows; cash back, points, and travel. Some people prefer the flexibility of cash back rewards, while others like the availability of the points, which can be redeemed for cash or other merchandise. Frequent travelers mostly prefer travel rewards cards because of the ability to earn free flights and other travel perks like hotel stays.
Secured credit card
Secured cards must have a security deposit to be placed on the cards. They are most preferred by people who don’t have a credit history or the ones who have damaged their credit status. The amount of credit limit on a secured credit card is typically equal to the amount of the deposit made on the card, but sometimes it could be more in some cases, including significant defaults such as defaulting on things like a mortgage payment. It’s worth noting that you’re still expected to make monthly payments on your secured credit card balance.
Prepaid cards are credit cards that need the owner to load money onto the card before the card can be used. All the Purchases are deducted from the card’s balance. The spending limit does not renew unless more money is loaded onto the card. They usually do not have finance charges or minimum payments because the balance is withdrawn from the deposit made.
While we have many different types of credit cards, it’s ideal to first assess your goal before choosing the best credit cards to build credit. You should find one that suits your lifestyle, value, and financial situation.